Market Daily Report: KLCI ends at intraday high as investors weigh corporate earnings

KUALA LUMPUR (July 28): The FBM KLCI closed up 18.46 points or 1.16% at its intraday high of 1,609.94 today as investors weighed corporate earnings against the possibility of a second wave of global Covid-19 infections.

Spectre of the second wave helped share prices of rubber glove manufacturers rise to all-time highs today.

Meanwhile, news on former prime minister Datuk Seri Najib Razak being found guilty by the High Court here today of all seven charges involving abuse of power, criminal breach of trust and money laundering in relation to the RM42 million belonging to SRC International Sdn Bhd, could have also influenced investor sentiment.

Inter-Pacific Securities Sdn Bhd head of research Victor Wan told theedgemarkets.com: “As the earnings forecast is rather fluid, the broader theme hinges on recovery, whether there is room for upside after what market expects to be an uninspiring second quarter.”

Across the bourse, trading volume stood at 11.85 billion securities valued at RM7.25 billion. Gainers led decliners at 631 against 500 respectively.

Malaysia's corporate financial reporting season for the April-to-June quarter starts as early as July although most companies report their earnings in August.

Today, exchange operator and regulator Bursa Malaysia Bhd's second quarter earnings announcement was closely watched as robust securities trade volume led to expectation of better earnings for the group.

Bursa said net profit rose to RM86.23 million in the second quarter ended June 30, 2020 (2QFY20) from RM46.34 million a year earlier while revenue climbed to RM179.78 million from RM123.96 million.

For 1HFY20, Bursa said net profit rose to RM150.96 million from RM93.19 million a year earlier while revenue was higher at RM330.53 million versus RM250.49 million.

Today, Bursa's share price rose to its record high of RM10.98 before closing down 38 sen or 3.65% at RM10.04 on profit taking. Bursa was the leading decliner across the exchange.

Notable gainers included rubber glove manufacturers, whose shares rose to record highs before paring gains when markets closed.

Hartalega Holdings Bhd led the top gainers’ list after it closed up RM1.60 or 8.74% at RM19.90. Hartalega had earlier today risen to its all-time high of RM19.92.

Supermax was the second-largest gainer after its share price finished up RM1.56 or 8.94% at RM19. The stock was traded between RM19.36 and RM17.36 today.

Najib's case was closely watched.

At the High Court today, it was reported that Justice Mohd Nazlan Mohd Ghazali said Najib's case had been proven beyond reasonable doubt as the defence failed to rebut the prosecution's argument.
Meanwhile, crucial global highlights include gold prices and the US Federal Reserve's Federal Open Market Committee meeting on Tuesday and Wednesday (July 28 and 29).

It was reported that gold hurtled to record peaks on Tuesday before the sheer scale of its gains drew a burst of profit taking, which in turn helped the US dollar from two-year lows and curbed early equity gains.

"The precious metal had stormed almost US$40 higher at one point to reach US$1,980 an ounce, only for a wave of selling to slap it back to US$1,940 in wild trade.

"Gold is still up over US$125 in little more than a week as investors wager the Federal Reserve will reaffirm its super-easy policies at its meeting this week, and perhaps signal a tolerance for higher inflation in the long-run," Reuters said.



Source: The Edge